Fauji Fertilizer Bin Qasim reports positive performance in Q3 2024

Fauji Fertilizer Bin Qasim (FFBL), a leading Pakistani urea and DAP manufacturer based in Rawalpindi, reported a significant increase in its financial performance for the third quarter of 2024. The company announced on October 23 that its unconsolidated profit for the third quarter reached PKR 8 billion (approximately US$ 28.80 million), marking a 51% increase from the same period in the previous year. The impressive results for the first nine months of 2024 also showed substantial growth, with profits reaching PKR 18.5 billion (US$ 66.61 million), in stark contrast to the PKR 354 million recorded in the same period of 2023.

According to analysts at Topline Pakistan Research, FFBL’s financial outcomes for the third quarter exceeded industry expectations. The surge in profitability was attributed to higher-than-expected gross margins and lower-than-anticipated finance costs. The company’s success set a positive outlook for its future financial health.

Company Secretary Brigadier Khurram Shahzada (Retd) highlighted that the improved performance was primarily due to better gas availability, which increased to 84% of the allocated amount compared to 54% in 2023. This enhancement in gas supply allowed the company to boost its urea production and sales volumes by 118% and 98% respectively, year-on-year. The reduced need for urea imports and better international DAP margins were key factors contributing to the favorable quarterly financial results.

For the nine-month review period, FFBL officials noted that stable foreign exchange rates and robust international DAP margins played significant roles in driving the company’s performance. Governmental support in improving gas supply to 77% of the allocation, up from 56% during the same period last year, facilitated increased production and sales of urea and DAP. The company reported a 42% increase in urea sales volume, which further decreased the dependence on imported urea. Finance costs during this period also decreased by PKR 4.8 billion.

FFBL stressed the importance of a stable gas supply for the sustainability of the fertilizer sector. Optimizing the allocation of indigenous gas is seen as crucial for maximizing the utilization of this natural resource, reducing risks to food security, and conserving foreign exchange by minimizing the need for imports.